Ather Energy Files IPO Papers With SEBI, Eyes INR 3,100 Cr Via Fresh Issue

Electric two-wheeler maker Ather Energy has filed its draft red herring prospectus (DRHP) with capital markets regulator SEBI to raise more than INR 3,100 Cr through its initial public offering (IPO).

The proposed IPO is a combination of fresh issue of equity shares worth INR 3,100 Cr and an offer-for-sale (OFS) of up to 2.2 Cr equity shares with a face value of INR 1 each.

Ather Energy also plans to raise INR 620 Cr through a pre-IPO placement. If such placement is undertaken, the amount will be deducted from the total fresh issue size.

It was reported earlier that the emobility unicorn is eyeing a valuation of around $2.5 Bn for its IPO.

Caladium Investments, National Investment and Infrastructure Fund II, Internet Fund III, 3State Ventures and cofounders Tarun Mehta and Swapnil Jain are among investors who will offload their shares via OFS.

Meanwhile, automobile giant Hero MotoCorp, the biggest shareholder in Ather Energy with a 37.2% stake, will not sell shares in the IPO.

Proceeds to the tune of INR 927.2 Cr from the IPO will be used for phase I of the manufacturing facility that Ather Energy plans to set up in Chhatrapati Sambhajinagar, Maharashtra, to manufacture and assemble electric two-wheelers and batteries, as per the DRHP.

The company plans to commence production in a phased manner at the facility by May 2026 with a targeted capacity of 0.5 Mn E2Ws.

A portion of the funds raised through the IPO will also be allocated towards research and development (R&D), marketing initiatives, infrastructure, production initiative and other general corporate purposes.

It is pertinent to note that Ather joined the unicorn club recently after raising INR 600 Cr ($71 Mn) from its existing investor National Investment and Infrastructure Fund (NIIF) at a post-money valuation of  $1.3 Bn.

Founded in 2013 by Tarun Mehta and Swapnil Jain, Ather Energy manufactures EV two-wheelers and battery packs and also has its own charging infrastructure. After building its market on its 450 series of escooters, the startup recently launched a family escooter series Rizta and forayed into the smart helmet category.

In terms of escooter sales, Ather is the fourth biggest player in the Indian market, behind Ola Electric, TVS Motor, and Bajaj Auto. Ather’s total vehicle registration in August stood at 10,873 units, up almost 52% year-on-year (YoY).

As per its DRHP, Ather Energy widened its consolidated net loss by over 22% to INR 1,059.7 Cr in the financial year 2023-24 (FY24) from INR 864.5 Cr in the preceding fiscal year.

Revenue from operations also fell 1.5% year-on-year to INR 1753.8 Cr.

Ather’s DRHP comes at a time when its competitor Ola Electric has already gone public by raising over INR 6,145.6 Cr through its IPO. The Bhavish Aggarwal-led startup went public at a valuation of $4 Bn.

However, the company made a muted stock market debut, with its shares listing at INR 75.99 apiece on the BSE as against its IPO issue price of INR 76.

Note: We at Inc42 take our ethics very seriously. More information about it can be found here.